ARMs Drive Slight Improvement in Underwriting Standards -MBA

Posted To: MND NewsWire

While adjustable rate mortgages (ARMs) make up only a fraction of mortgage originations (just over 6 percent in the most recent Mortgage Bankers Association's (MBA's) volume summary), changes to some of their underwriting parameters were reflected in mortgage access numbers. MBA's Mortgage Credit Availability Index (MCAI) increased by 0.3 percent in July to 179.0, driven by increased availability of conventional programs. The Associations Vice President of Research and Economics, Lynn Fisher, explains, "Many agency eligible loan programs have been updated so that underwriting parameters for adjustable rate mortgages (ARMs) more closely align with their existing fixed rate counterparts . In many cases this means higher loan to value (LTV) ratios on existing ARMs loan programs, which exerted...(read more)

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